FAO/GIEWS - Food Outlook No.2 - May 2002 p.11

Cereal Import Bills

Further rise in cereal import bill

Based on the latest forecasts for cereal trade, food aid and prices, the overall cereal import bill to be borne by the world’s
most vulnerable food deficit countries is anticipated to increase again in 2001/02. The developing countries are likely to spend about US$23 billion for imports of cereals in 2001/02, up 5 percent from the previous season; while in
the Low-Income Food-Deficit Countries (LIFDCs), total cereal import bill could reach US$10 billion, up 9 percent from the previous season. Mainly on the basis of larger
imports, the LIFDCs would face an increase of more than US$7 per tonne in their per unit cereal import to around US$135 per
tonne. This is still significantly below the high levels of the mid-1990s when cereal prices were exceptionally high. Looking
further ahead, preliminary indications for 2002/03 point to a rise in the developing countries’ import bill for the fourth consecutive season to almost US$24 billion. The increase
would be on account of larger commercial imports since food aid shipments and international prices for major cereals are
assumed to remain at the current season’s levels.

The combined cereal import bill of the Least-Developed Countries (LDCs) and the Net-Food Importing Developing Countries (NFIDCs), which include a list of nations agreed by the World Trade Organization (WTO) to qualify as beneficiaries under
the Marrakech Decision on the Possible Negative Effects of the Reform Programme, is estimated at some US$6 billion in 2001/02.
This is almost unchanged from 2000/01, as anticipated slight increases in imports across LDC countries would largely offset
small declines among NFIDCs.

In general, wheat accounts for the largest portion of the cereal import bill for most countries. The overall value of wheat imports by the
developing countries in 2001/02 is forecast at nearly US$12 billion, up US$500 million from 2000/01. This small increase would
mostly reflect the expected expansion of some 3 million tonnes in imports by the developing countries in 2001/02.
For the LIFDCs, as a group, the value of total wheat imports in 2001/02 is forecast at US$5.4 billion, some US$300 million
more than in the previous season. By contrast, the value of purchases of coarse grains by the developing countries in 2001/02 is put at US$7.8 billion, around US$50 million smaller than in the previous season
despite some increase in prices. The main factor for the decline is the anticipated fall of some 3.6 million tonnes in the
volume of imports by the developing countries. The LIFDCs are also likely to spend slightly less on coarse grain imports in
2001/02. In the case of rice, the anticipated increase in the volume of imports together with the likely recovery in prices in 2002 will concur to raise
by 20 percent the developing countries' total import bill, to US$3.7 billion. Most of this growth would be accounted for by
countries in Asia as well as in Central America and the Caribbean. For the LIFDCs, the overall bill for rice is expected to
rise by 27 percent to US$2.3 billion, with countries in Asia bearing most of the increase.